Buffett Compares Federal Reserve To Hedge Funds

New York (HedgeCo.Net) – “The Fed is the greatest hedge fund in history.” Hedge fund pioneer and billionaire philanthropist Warren Buffett said while delivering a speech to the students at at Georgetown University in Washington.

The Fed is generating “$80 billion or $90 billion a year probably” in revenue for the U.S. government, he said. “And that wasn’t the case a few years back.” Bloomberg reports. The Federal Reseve is capable of earning profit from bond purchases and has a balance sheet balance of more than $3 trillion, according to reports.

On a possible successor to the current chairman of the Federal Reserve, Ben Bernanke, Buffett said, “Next capable candidate is Vice Chairman Donald Kohn.”

“Buffett applauded Bernanke for sailing through the 2008 crisis, and said that he did whatever was necessary to balance the market. Buffett said that his successor will follow his footsteps to economic stimulus. Investors were expecting that Bernanke would streamline his current stimulus, but he continued it with the same pace. Bernanke said he wants to see more revival in the economy, but Buffett feels that Bernanke was disappointed to see the current rate of growth, though only slightly.” ValueWalk reports.